Summary: Changes and enhancements to the 1997-98 application processing system.
Action Letter #5
SUMMARY: Changes and enhancements to the 1997-98 application
This Action Letter describes changes to the 1997-98 application
processing system, the Free Application for Federal Student Aid
(FAFSA), the Renewal FAFSA, the Student Aid Report (SAR), and
the Institutional Student Information Record (ISIR). These are the
major improvements that we have made:
We distributed FAFSAs beginning mid-October, earlier than
We included a return postcard with the FAFSA, to notify
students the application was received.
We have redesigned the Renewal Application.
We have redesigned the SAR.
We added a new reject for situations when reported date of birth
is the same as the current year to improve the accuracy of data
We revised the edits for Worksheet #3 income to improve
We added new flags to improve the reporting of National
Student Loan Data System (NSLDS) match results and changes
to NSLDS data.
We changed the system to allow students to make address and
institution changes with a telephone call to the Federal Student
Aid Information Center.
We made a number of enhancements to the FAFSA Express
software to make it easier for students to use.
FREE APPLICATION FOR FEDERAL STUDENT AID (FAFSA)
WE DISTRIBUTED FAFSAS BEGINNING MID-OCTOBER,
EARLIER THAN EVER. As announced previously, the FAFSA
distribution process for 1997-98 has been enhanced through use of a
toll-free number (1-800-284-2788) that allows a school to enter the
school code and place an order. This service is available 24 hours a
day, seven days a week. After placing an order, schools can call the
same number to check on the status of their orders. Alternatively,
FAFSAs can also be ordered by faxing in a scannable form (see Dear
Colleague Letter ANN-96-4 for more information).
The color of the 1997-98 FAFSA is green. We have not made any
changes to the questions and sections, which are organized in the
same sequence as in 1996-97. The date fields have been expanded to
allow for the new century, although we preprinted the "19" for all
date fields except question 31: "Date you expect to receive your
CHANGES TO WORKSHEET #3 AND UNTAXED INCOME
Questions 64 and 76, formerly titled "Total from Worksheet #3,"
have been renamed "1996 Amount from Line 5, Worksheet #3."
This issue is discussed further in the "Central Processing System"
The Untaxed Income items collected on Worksheet #2 include two
clarifications: FAFSA filers are instructed to include VA
Educational Work-Study Allowances in the amount reported as
other untaxed income (questions 63 and 75). This income was
previously treated as a resource in determining loan amounts.
Applicants are also instructed not to include contributions to, and
payments from, flexible spending arrangements (e.g., cafeteria plans,
medical savings accounts) as other untaxed income.
RETURN POSTCARD IN APPLICATION PACKAGES
WE INCLUDED A RETURN POSTCARD WITH THE FAFSA, TO
NOTIFY STUDENTS THE APPLICATION WAS RECEIVED BY
A FAFSA PROCESSOR. The postcard instructs the student to fill in
his or her home address, affix a 20-cent stamp, and enclose the card
in the return envelope with the application. When the application or
Renewal Application is received, the FAFSA processor will stamp
the card with the receipt date and location, and mail it back to the
In order for this notification to work, the student must complete the
address correctly and remember the postage stamp. The postcard
offers a simple method for students to be assured that their form has
been received, although it does not guarantee that the form will be
processed if another problem exists. The processors examine each
form to make sure the student's signature and social security number
are present. If either is not present, the form will be returned
unprocessed with the unmailed postcard and a letter explaining why
the form could not be processed.
RENEWAL FREE APPLICATION FOR FEDERAL STUDENT AID
WE HAVE REDESIGNED THE RENEWAL APPLICATION. The
Renewal FAFSA preprints much of the student's 1996-97 application
data and allows the student to update the information submitted in
1996-97, if necessary, and enter new income information. Please see
1997-98 Action Letter #1 (GEN-96-16) for a description of how the
process works and a schedule for dates when institutions and students
will receive their 1997-98 Renewal FAFSAs.
The Renewal FAFSA was redesigned to improve the appearance and
ease-of-use for students, and to facilitate imaging and scanning.
Instead of a three-column layout, the 1997-98 Renewal Application
has an enhanced format that allows more space for students to write
in new or updated responses. The response fields resemble those on
the FAFSA, i.e., multiple-response questions, such as enrollment
status, allow the student to darken an oval in response rather than
referring to instructions to locate and transfer a code. Students will
need to refer to the instructions for coded responses for only two
fields: course of study and type of degree/certificate.
The Renewal Application printed by the CPS will be on 11 x 17-inch
STUDENT AID REPORT
WE HAVE REDESIGNED THE SAR using a format similar to the
Renewal Application with special emphasis on adapting the
document for imaging and scanning technology. As in previous
years, the data elements on the SAR are ordered and numbered to
correspond with data elements on the FAFSA and Renewal FAFSA.
The SAR will be printed on green paper, 8 « by 11-inches, which
can easily be distinguished from the Renewal FAFSA.
The design of Part 1 of the SAR, the SAR Information
Acknowledgement, and the format and position of the Financial Aid
Administrator (FAA) Information Box, have not changed from
1996-97. SARs may be either 4 or 5 pages (sheets), depending on
whether the student's application is rejected or nonrejected. As in
previous years, a nonrejected SAR will consist of five pages with the
Information Review Form (IRVF) as Part 2, and a calculated EFC.
A student whose application data are rejected as incomplete or
inconsistent will receive a four-page SAR with the Information
Request Form (IRQF) as Part 2. The IRQF requires the student to
correct or verify certain information on the SAR, which is identified
by an arrow printed in the questioned field. In 1997-98, the student
must write a new answer in the boxes or ovals that appear to the right
of the arrow to make a correction. To verify that the previous
answer was correct, the student would re-write the same answer in
the answer spaces. The new design does not include check-off boxes
to verify answers.
For FAFSA Express submissions, the signature procedures used in
1996-97 will remain the same: Students who submit their
applications electronically using the software may print and mail in a
Signature Page if they have a printer available, or they will receive a
"Reject 16 SAR" if they are unable to print and mail in a Signature
Page or their Signature Page cannot be processed. Reject 16 means
that the student's signature was not present on the application. This
type of SAR incorporates two additional certification statements in
the signature block that the student must sign and submit on Part 2:
the Statement of Educational Purpose and the Statement on
Overpayments and Defaults. In all other scenarios, these
certifications are incorporated in signing the application: FAFSA,
Renewal FAFSA or FAFSA Express Signature Page. See the
FAFSA Express section that follows for more information about the
The FAA Information section appears at the end of the SAR
comments and will be printed on the second page (sheet) of Part 1 on
a nonrejected SAR, or on the back of page one of a rejected SAR.
The FAA Information section for 1997-98 will include a new
NSLDS Results Flag, NSLDS Transaction Number, Transaction
Receipt Date, and a Reprocessed Reason Code. A detailed
description of these flags follows in the Central Processing System
The National Student Loan Data System (NSLDS) Financial Aid
History will be printed on the second page of Part 1 of the SAR if
relevant NSLDS information for that student is present in the
National Student Loan Data System.
CENTRAL PROCESSING SYSTEM (CPS)
THE 1997-98 CENTRAL PROCESSING SYSTEM WILL START
UP ON JANUARY 10, 1997, AND WE ARE CURRENTLY ON-
SCHEDULE IN SYSTEM DEVELOPMENT AND TESTING
ACTIVITIES. We do not anticipate any delays. New for 1997-98,
both Applications and Corrections processes will become available
on the same day. This means that paper FAFSAs and Renewal
FAFSAs received by the FAFSA processors will be processed by the
CPS, and schools may submit both applications and corrections
electronically as soon as the system starts up. The FAFSA
processors have made many improvements in their systems to ensure
that they will be able to meet required turnaround times for 1997-98.
WE ADDED A NEW REJECT (REJECT 4) FOR SITUATIONS
WHEN THE REPORTED DATE OF BIRTH IS EQUAL TO THE
CURRENT YEAR, TO IMPROVE THE ACCURACY OF DATA
MATCHES. Addition of this reject will facilitate more accurate
matching with the NSLDS and Social Security Administration
(SSA), and will make students more aware of the importance of
reporting the birth date accurately. Analysis shows that
approximately 9,900 students made this error in 1995-96.
REVISED SOCIAL SECURITY ADMINISTRATION MATCH
Beginning with 1997-98 processing, we will handle one of the
possible matching situations with the Social Security Administration
(SSA) differently. The current Reject S (social security number not
found in the SSA database) has been changed to Reject 18, which
does not allow a student simply to "verify" that the same SSN is
correct. If the student believes the originally reported SSN is
actually correct, he or she must follow-up with SSA to determine
why the reported SSN is not in the SSA database. The SSA has
informed us that it can add an applicant's SSN within a few days
after the applicant provides SSA with documentation of a correct
SSN. After ensuring that the SSA database is updated, the student in
this example may submit a SAR correction with the same SSN
re-entered, and eliminate the reject when the match is conducted
again with SSA.
If the originally reported SSN is NOT correct, the student may submit
a SAR correction with the new SSN (current SSN) and when the new
SSN is matched with the SSA database, the reject will also be
eliminated. However, keep in mind that in both examples, the
student's identifiers (the original SSN and first two letters of the last
name) will not change when the SSN is corrected on the SAR. This
could create problems when the student's record is matched with the
Pell Grant Recipient Financial Management System. We
recommend that a student who receives Reject 18 and determines
that a correction to the originally reported SSN is needed, submit a
new FAFSA and start over rather than attempting to correct his or
her SSN on the SAR.
EDIT FOR WORKSHEET #3 INCOME
WE REVISED THE EDITS FOR WORKSHEET #3 INCOME TO
IMPROVE ACCURACY. For the student's information (item 64), if
the Amount from Line 5, Worksheet #3 is equal to or greater than the
sum of the student's AGI, Earned Income Credit, and all Untaxed
Income fields, the CPS will assume that the value of Amount from
Line 5, Worksheet #3 is zero. However, a student or financial aid
administrator may submit a correction using the same value, and the
CPS will accept a value that is equal to the student's total income and
not make the assumption again. Thus, if a student's entire earnings
are derived from taxable work-study income (all of which is
excluded from the EFC calculation), the student will receive an
accurate EFC on the next transaction. This revision was put in place
for 1996-97 and will continue to work in the same way for 1997-98.
For the parents' information, the CPS will assume "zero" if the 1996
Amount from Line 5, Worksheet #3 is greater than a fixed
percentage of the total income reported by the parents. The
parents' income limit was determined by an analysis of reporting
behavior in 1996-97. To summarize, the 1996 Amount from Line 5,
Worksheet #3, for either student or parents may be corrected to the
same value (greater than a percentage of total income for parents and
100% of total income for students) and the assumption will not be
made again. The assumption to zero will continue to be made if the
reported amount is GREATER than total income.
CHANGES TO FAA INFORMATION
WE ADDED NEW FLAGS TO IMPROVE THE REPORTING OF
NATIONAL STUDENT LOAN DATA SYSTEM (NSLDS)
MATCH RESULTS AND CHANGES TO NSLDS DATA.
NSLDS RESULTS FLAG. The FAA Information appearing on the
SAR and ISIR will include a new "NSLDS Results Flag." This item
will display one of four possible values:
"1" means that the reported SSN was matched and confirmed
with the NSLDS and NSLDS data were sent to the CPS and
will appear on the SAR and ISIR. Schools are responsible for
using this information when determining eligibility for Title IV
"2" means that the student's SSN was found in the NSLDS but
the match could not be confirmed using either the name or
date of birth. This result will generate comment code #138,
informing the student and school that the problem must be
resolved before Title IV aid can be paid. See Dear Colleague
Letter (GEN-96-13) Q&A #26 for further discussion of this
"3" means that the reported SSN was not found in the NSLDS,
and a school can assume the student had not received any
previous Title IV loans or Pell Grant funds unless the school is
aware of conflicting information.
"4" means that the reported SSN was found and confirmed in the
NSLDS, but there were no relevant data to return to the CPS.
For example, the only data in the NSLDS were a prior year's Pell
disbursement or one or more loans that had been fully repaid or
NSLDS TRANSACTION NUMBER. We added this flag as a signal
to financial aid administrators when something has changed in a
student's NSLDS financial aid history, and needs to be reviewed. For
example, on the first 1997-98 transaction (01), the NSLDS
transaction number will be "1." When an 02 transaction resulting
from a correction is processed, the record is matched again with
NSLDS. If the NSLDS information for that student is unchanged,
the NSLDS transaction number will continue to be reported as "1."
If a further correction is processed and an 03 transaction created,
current NSLDS information is compared with the previous
transaction. If these data are different than the data reported on
the earlier transaction, the NSLDS Transaction Number will be
set to "3."
The value reported as the NSLDS Transaction Number will enable
the FAA to determine if NSLDS data on a subsequent transaction
needs to be reviewed. In the example above, if the NSLDS data
from transaction 01 had been reviewed and used, the FAA would not
need to review NSLDS data on the second transaction because the
NSLDS Transaction Number of "1" indicated nothing had changed.
The FAA would need to review NSLDS data on the 03 transaction
because the NSLDS Transaction Number of "3" indicated that data
had changed from the earlier transactions.
A request from the applicant or a school for a duplicate CPS record
is also sent to the NSLDS. If the NSLDS data has not changed, the
record will be processed as a duplicate with the same CPS and
NSLDS transaction numbers. However, if the NSLDS data are
different, the record will be processed as a system-generated
correction (Sys Gen = L), and both transaction numbers will be
TRANSACTION RECEIPT DATE. We will display the date that
the input for each transaction is received by a FAFSA Processor or
the CPS, whether that input is paper or electronic, a subsequent
application, or a correction. This date will appear in addition to the
"Application Receipt Date," which displays the date that the original
(or first) application was received. The Transaction Receipt Date
will change for each transaction, but the Application Receipt Date
will remain constant.
REPROCESSING CODE. This numeric code will be used to
provide more specific information about system-generated records.
If a subset of student records requires reprocessing, for example,
there are changes in the formula or maximum EFC, or problems with
NSLDS data for certain students, the Reprocessing Reason Code will
appear on the reprocessed records along with the System Generated
(Sys Gen) = Z code that identifies a reprocessed batch. This code
will be numeric and will be assigned and incremented with each
reprocessing. The definition for a code will be available from
customer service and announced on the Student Financial Assistance
Bulletin Board Service (SFA BBS).
SOCIAL SECURITY MATCH
Currently, a correction transaction is sent to the SSA match only
when the student changes the SSN. Beginning in 1997-98, we will
send a student's record for a new match with SSA if the student
makes corrections to the SSN, the name, or the date of birth. A new
match flag will be generated and reported in the FAA Information
section. Once confirmation of all the SSA match elements has been
obtained (i.e., SSN, name, and date of birth all match and U.S.
citizenship is confirmed), the SSN and citizenship flags will be
carried forward to the student's 1998-99 Renewal Application, and
the SSA match will not have to be performed each time the student
applies for aid. If a student whose match data have been confirmed
subsequently attempts to change his or her SSN, the system does not
accept the change and generates a comment (comment code #13)
advising the student to contact their FAA for assistance.
CITIZENSHIP STATUS INFORMATION
Also in 1997-98, if a student does not report citizenship status on the
application, but the match with SSA confirms that the student is, in
fact, a U.S. citizen, we will not reject the application for blank
citizenship (Reject 17). If a student indicates that he or she is an
eligible noncitizen, provides an Alien Registration Number, and the
status is confirmed by the Immigration and Naturalization Service
(INS) match, we will not show any flag on the student's record for
the SSA Citizenship match. Only the appropriate INS match flag
will appear in FAA Information on the SAR or ISIR record.
FEDERAL STUDENT AID INFORMATION CENTER WILL
ENTER ADDRESS AND SCHOOL CHANGES
Finally, we have made an important enhancement to our delivery
system that will allow students to telephone the Federal Student Aid
Information Center (FSAIC) at (319) 337-5665 to request address
and institution changes. The student must provide his or her
personal Identification Number (PIN) as identification, and the
operators will be able to key-enter address changes and school
changes on-line for processing by the CPS. After the requested
change is processed, the CPS will print and mail the student a new
SAR and electronic schools listed on the student's record will receive
ISIRs. This procedure will speed processing of two of the most
frequent types of corrections that students make.
The student's PIN is printed on the student's SAR or SAR
Information Acknowledgement, but will not appear on the electronic
ISIR or magnetic tape/cartridge ISIRs. For EDExpress, we have
enhanced the software beginning with 1996-97 version 2.5 so that an
institution can add other institution codes to a student's electronic
record without the PIN.
WE ARE SCHEDULED TO BEGIN DISTRIBUTION OF THE
1997-98 FAFSA EXPRESS SOFTWARE IN DECEMBER. THE
SOFTWARE WILL ALSO BE AVAILABLE FOR DOWNLOADING
FROM THE DEPARTMENT'S WORLD WIDE WEB HOME
PAGE BY SYSTEM STARTUP IN JANUARY. Because of problems
that some students had in printing complete and accurate signature
pages, the 1997-98 software clarifies instructions for configuring a
printer and includes a checklist to review whether the signature page
has printed out correctly. In addition, the CPS will hold an applicant's
data for 14 days rather than 21 days while awaiting a valid signature page.
If a valid signature page is not received within 14 days, the CPS will process
the application as a Reject 16. If the Signature Page is not expected (the
student indicates in the software whether a printer is available), the CPS
processes the data immediately and sends the student a Reject 16
SAR for his or her, and a parent's, if applicable, signature. Once a
Reject 16 has been produced, the CPS cannot process a signature
page printed as part of the FAFSA Express process. Only a signed
SAR or EDExpress signature flag will clear the reject.
The FAFSA Express software can be downloaded from the
Department's World Wide Web home page and installed on a PC
with a modem. The home page address for the software is:
WE MADE A NUMBER OF ENHANCEMENTS TO THE FAFSA
EXPRESS SOFTWARE TO MAKE IT EASIER FOR STUDENTS
Software will allow application data to be saved partially or
completely to diskette. The saved file can be used later to
complete the application in multiple sessions, and/or transmit
data again if first transmission fails;
An improved telecommunications interface will configure the
modem automatically and facilitate easier use for most students;
Downloading and installation from the World Wide Web will be
Search options for Title IV Codes will be expanded to allow
students to locate codes alphabetically by school name or by
Software will be promoted extensively to high schools and
colleges, and distributed automatically to Educational
TITLE IV SCHOOL CODES
Earlier this year, the Department mailed a letter to schools requesting
name, address, and Title IV Code updates. These updates were due
back to the Department by July 15, 1996. The Title IV School Code
book will be published as an Action Letter in November, and mailed
to high schools, colleges, and public libraries.
Students and schools can also access the Title IV Code List on the
Department's home page:
We continue our efforts to improve the application processing
system and respond to the concerns and needs that you, our
customers, have expressed in focus groups, at conferences, and
other forums. Please continue to communicate with us about other
system changes you wish to suggest; and also let us know when
processes and changes are meeting your needs, so we can better
support you in the delivery of aid to your students.
Elizabeth M. Hicks
Deputy Assistant Secretary
for Student Financial Assistance
Renewal FAFSA mockup
SAR mockup (with NSLDS page)
SAR Information Acknowledgement
1997-98 Verification Worksheets
1997-98 Address/School Change Form
1997-98 SAR Comment Activity for Matches and Hold Files
*[Attachements are currently not available for viewing on the BBS,
but may be requested by contacting the Student Financial Aid
Information Center at 1-800-433-3243.]